Dealwatch: Transatlantic teams promote £ 8 billion acquisition of National Grid while Freshfields and Latham participate in Deliveroo’s initial public offering
To mark the one-year anniversary of the city’s first coronavirus lockdown, elite playmakers continue to do business in their homes. A sizeable acquisition of National Grid and the multi-billion pound IPO of Deliveroo made headlines in the past few days.
Last week (March 18), FTSE 100 utility National Grid emerged as the winner of a competitive auction to acquire Western Power Distribution (WPD), the UK’s largest electricity distribution company, from PPL Corporation for an equity value of £ 7.8 billion .
At the same time, National Grid agreed to sell Narragansett Electric Company – the largest power transmission and distribution service provider in the US state of Rhode Island – to PPL for USD 3.8 billion (£ 2.7 billion).
In the meantime, the promise of further strategic deal activity is also imminent, as National Grid has announced that it will initiate a sale process for a majority stake in its UK gas transmission business later this year.
The acquisition of WPD is part of the utility’s plan to refocus its UK portfolio on electricity and significantly strengthen its central role in meeting the UK’s net zero targets.
Herbert Smith Freehills worked for National Grid on the acquisition. The team was led by corporate partners Caroline Rae and Bob Moore, including James Palmer, Silke Goldberg, Will Nevin, Will Breeze, Isaac Zailer, Tim Briggs, Veronica Roberts and Paul Ellerman. They worked with the National Grid legal team, including the group’s general counsel and company secretary Justine Campbell, and senior legal advisor Deborah Waller.
Cravath, Swaine & Moore worked for National Grid under New York law with a team led by partners GJ Ligelis and Mark Greene on M&A matters.
Ashurst served on the sale for seller PPL and created a team led by corporate partner Nick Williamson, which also included corporate partner Aaron Shute, competitive partner Neil Cuninghame and tax partner Nicholas Gardner. Partner Alex Biles advised on debt issues, Eleanor Reeves advised on environmental, health and safety issues, and Ruth Buchanan on employment and pension issues. The team also covered a number of other practices including intellectual property, real estate, dispute resolution, and financial oversight.
PPL was also advised by a Skadden M&A team led by Pankaj Sinha, which included Washington DC partners Richard Oliver and Eric Sensenbrenner.
Speaking to Legal Business, Ashurst’s lead partner Nick Williamson commented on the deal: “What was interesting was that PPL not only sold its UK business, but also bought assets in the US. They were two different M&A deals, and executing and signing both on the same timeline and in lockdown is a significant achievement.
‘In the past two years, the ongoing energy transition and ESG have developed into strong drivers for M&A transactions and permeates almost every sector. Listed customers increasingly want help and support with ongoing ESG matters. ‘
Partner Aaron Shute added: ‘In terms of market prospects, this is the UK’s largest power distribution business. The attractiveness of this asset reflects both its quality and the increased need for electricity capacity as a result of the increasing shift towards electrification and, more generally, the ongoing energy transition, including helping the UK achieve its net zero emissions target. “
This week saw the long-awaited IPO of the takeaway food delivery company Deliveroo, a business that has become ubiquitous as it closes with UK restaurants closings.
The Deliveroo listing is expected to have a dual class share structure with two classes of common shares – Class A and Class B shares – the latter being maintained by the company’s founder and director. According to many market participants, the IPO price range has been set at £ 3.90 to 4.60 per share, implying an estimated market capitalization at listing between £ 7.6 billion and £ 8.8 billion. The primary offering is expected to generate gross proceeds of around £ 1 billion, in addition to a secondary sell-off by some existing shareholders.
The Latham & Watkins capital markets team was tasked with advising the joint global coordinators, bookrunners and underwriters on the London Stock Exchange’s largest IPO in ten years.
The team is led by London corporate partners Chris Horton, Josh Kiernan, Ryan Benedict and Anna Ngo. British employment advice is provided by London partner Sarah Gadd, data protection by London partner Gail Crawford, US tax advice by New York partner Jocelyn Noll and UK tax advice by London partner Karl Mah.
Freshfields Bruckhaus Deringer works for Deliveroo on the list, with a team led by partners Mark Austin and Doug Smith.
After all, Kirkland & Ellis had a blistering couple of weeks in which three major transactions were processed in quick succession. The London teams worked for TDR Capital, TA Associates and Thoma Bravo.
Kirkland advised TDR Capital on the acquisition of BPP, a provider of vocational and professional training, with a team led by transaction partners David Holdsworth, Rachel Greenhalgh, Stuart Boyd and Carlos Gil Rivas and debt financing partner Chris Shield and Ambarish Dash tax partner Tim Lowe.
The company also advised TA Associates and the consortium vehicle on the acquisition of Unit4, an enterprise cloud software company, from Advent International for more than $ 2 billion. The team was led by Carlos Gil Rivas, David Holdsworth and Tom McCarthy, debt finance partners Neel Sachdev and Sam Sherwood, and tax partners Tim Lowe and Sam Trowbridge.
Amsterdam-based De Brauw Blackstone Westbroek partner Lennard Keijzer was responsible for the Advent seller.
Finally, Kirkland advised software and technology-focused private equity firm Thoma Bravo on the acquisition of Calypso Technology from Bridgepoint and Summit Partners.
The Kirkland team was led by corporate partners Carlos Gil Rivas and Dan Clarke and also included corporate partners Ted Peto, Peter Stach and Laurent Victor-Michel.
Farah O’Brien in Latham led a team that advised the sellers.